In April 2025, the inflation rate in Germany stabilized at +2.1% compared to the same month last year, down from 2.2% in March 2025. This marks the lowest value since October 2024 and indicates a slight easing of price pressure.
Impact of Energy Prices
Energy prices have exerted a dampening effect on inflation. In April, energy prices dropped considerably by about -5.4%, mainly due to lower costs for fuels, solid fuels, and heating oil. This decrease in energy costs has a positive effect, mitigating the overall rise in consumer prices.
Further Price Developments
- Inflation for goods fell sharply to 0.5% (down from 1.0%).
- Food prices increased somewhat slower (+2.8% instead of +3.0%) compared to the previous month.
- In contrast, service inflation accelerated to a three-month high of 3.9%.
- Core inflation (excluding energy and food) rose slightly from 2.6% to 2.9%.
Importance for Savers and Investors
The dampening effect of falling energy prices is particularly relevant for savers and investors. Moderate inflation of around two percent impacts purchasing power: it remains relatively stable without strong erosion of money value. At the same time, this development influences interest rate trends – in particular, it could give the European Central Bank (ECB) room for rate cuts or at least a less restrictive monetary policy. Although the inflation level is slightly above the ECB’s target (typically close to two percent), it does not pose a serious risk.
In summary: The inflation rate in Germany remained stable at +2.1% in April 2025; falling energy prices exert an inflation-dampening effect and create a relaxed situation regarding purchasing power losses and monetary policy decisions.